&imwidth=800&imheight=600&format=webp&quality=medium "After tariff blow, Trump refuses to extend US trade pact with Canada and Mexico he negotiated in first term")
The United States will not renew its North American trade agreement with Canada and Mexico in its current form, US Trade Representative Jamieson Greer said on Wednesday. Instead of receiving a long-term extension, the United States-Mexico-Canada Agreement (USMCA) will now undergo annual reviews while remaining in force until its scheduled expiry in 2036.
The decision is expected to create fresh uncertainty for businesses across North America because supply chains, particularly in the automobile sector, remain closely integrated. Wednesday marked the deadline for the three countries to decide whether to extend the pact. Although Washington declined to renew it, negotiations will continue unless one of the member countries withdraws.
The move follows a February 2026 US Supreme Court ruling that struck down the tariffs, saying the administration had exceeded its executive powers. The ruling came after President Donald Trump imposed a 25 per cent tariff on imports from Mexico and a 25 per cent tariff on imports from Canada on March 4, 2025. Canadian oil and energy products, however, faced a lower 10 per cent tariff.
Trump negotiated the USMCA during his first term and signed it into law in 2020 as a replacement for the 1992 North American Free Trade Agreement.
At the time, he described it as the "fairest, most balanced, and beneficial trade agreement we have ever signed into law". During his second term, however, he imposed tariffs on nearly all trading partners while keeping exemptions for products covered under the USMCA.
"The United States did not agree to renew the USMCA in its current form. As a result, the USMCA is not renewed," Greer said in a statement.
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"The United States will continue to engage with Mexico and Canada to address the agreement's shortcomings and our trade deficits with these countries," he added.
A senior US official told reporters that narrowing trade deficits remained a key priority, alongside improving market access in Canada and Mexico. The official also highlighted ongoing disagreements over dairy and corn.
Trump had already indicated in June that he was not "looking to renew" the agreement despite having negotiated and praised it during his first presidency.
Canada and Mexico had both sought a 16-year extension of the USMCA. With the pact now subject to annual reviews instead of a longer renewal, negotiations on tariffs and sector-specific trade rules could continue for months or even years.
